Selling a House in Your State

Selling your house (or townhouse or condo) is one of the most important legal and financial transactions you'll ever have. Knowing what to expect and understanding each main step in the sales processhelps you skip frustration and headaches until your sale closes.

Learn the basics if you're a first-timeseller, or take a refresher if you're a seasoned seller. After all, homes are unique, and not all sales are alike.

Using a Real Estate Broker or For Sale by Owner

Selling your home isn't that difficult, but itcan be time consuming and there are lots of details to manage, so most homesales are made through a real estate broker or agent. Know the basics ofworking with these state-licensed sales professionals.

Generally, a "sales person" is areal estate broker, or a sales agent working under a managing or sponsoring broker's authority.

Working with a Real Estate Broker or Agent

In many states, brokers and agents can represent the seller, the buyer or both (called dual agency). When you contact a broker or agent, you should be given a consumer disclosure explaining all possible roles. Ask questions on items you don't understand. You'll enter into a listing contract to sell your home. You can specify that the broker works for you as a seller's agent alone.

Real estate brokers and agents have what's called a fiduciary duty to the party they're representing. This means they are your legal agents and are held by law to specific duties found in state law, or your listing or brokerage agreement, or other contract. These duties include:

Loyalty

Disclosure

Confidentiality

Using reasonable care and skill

Obeying your lawful instructions

Accounting for all money in the agent's control

Seller's Property Disclosure

Many states require home sellers to disclose defects in their property that affect health and safety. You can use a standard form, called a seller's property disclosure statement. Complete the form, even if a given item doesn't impact the sale or the final sales price. Common disclosure items include:

Be accurate and truthful as you complete the disclosure form. Ask your real estate lawyer for help if you're unsure on how to answer any items. Remember that disclosure helps avoid problems later on, and benefits you and your buyer all around.

Getting an Offer: The Purchase Agreement

When a serious buyer wants to buy your home, you'll receive a written offer, sometimes called a purchase and sale agreement, containing all the terms of the sale.

Know what to expect in an offer because you won't have much time to decide to accept or make a counteroffer. Common counteroffer terms are:

A higher purchase price

A higher deposit

Less time for the buyer to remove contingencies, such as getting financing or selling his or her current home

Excluding items from the sale, such as appliances or window treatments

Time for your attorney's review of the contract

Legal Title Issues

One key term in the purchase and sale agreement is that you give the buyer clean title, or "clear and marketable" title to the property. This means there aren't any issues or conflicts with the ownership rights you're selling. Examples are possible past owners or mortgage holders who could turn up claiming property rights.

Your real estate lawyer or title insurance company will do a title search, looking for any problems. A title insurance policy is also issued to cover any title defects that didn't turn up in the title search, such as a mortgage, lien or easement missed or not recorded in public records.

Closing and Costs

The closing is the completion of the sale: the buyer pays the sales price, and you transfer title to the buyer, along with the keys. There's a lot of work leading up to closing, and some costs forsellers to pay.

Common seller's costs are:

Paying off all existing mortgages and liens against the property

State transfer taxes

Local transfer taxes (the duty to pay these taxes varies by location and custom)

Real estate sales commission to your broker or agent

Generally, you don't have to attend the closing. Your lawyer can represent you, taking signed documents and the keys.

Lawsuits and Your Sale

Lawsuits arising from home sales are the exception, and not the rule. Most sales are completed successfully, even if they take more time than the sellers would like, or there are problems to solve along the way.

Common causes behind lawsuits are:

Breach of contract – breaking some term of the purchase agreement

Disclosure or defect issues – the buyer finds a problem with the home and thinks you're liable

Fraud or misrepresentation – you said or made representations that weren't true, but the buyer relied on them

Sales commission claims – the right to payment or amount of the commission is disputed

The solution or remedy sought in these cases is usually money damages, or specific performance, which means to do what the contract requires. An example is a buyer who wants you to complete a sale after you change your mind about selling.

No matter if it's your first sale or your fifth, you're ready to sell, from contract to closing.

Questions for Your Attorney

Can I cancel a contract if the buyer misses deadlines and I'm worried about getting to closing?

Do I owe my real estate agent a commission if I find a buyer?

How do I cover past repairs on a disclosure form? If there are no problems after a repair, is there anything to disclose?

Regional Sites

Other Resources

Connect with Us

Disclaimer: The information provided on Lawyers.com is not legal advice, Lawyers.com is not a lawyer referral service, and no attorney-client or confidential relationship is or should be formed by use of the site. The attorney listings on Lawyers.com are paid attorney advertisements and do not in any way constitute a referral or endorsement by Lawyers.com or any approved or authorized lawyer referral service. Your access of/to and use of this site is subject to additional Terms and Conditions.

Martindale-Hubbell and martindale.com are registered trademarks; AV, BV, AV Preeminent and BV Distinguished are registered certification marks; Lawyers.com and the Martindale-Hubbell Peer Review Rated Icon are service marks; and Martindale-Hubbell Peer Review Ratings are trademarks of Internet Brands, Inc., used under license. Other products and services may be trademarks or registered trademarks of their respective companies.